David,
>>>Notice the "technical air pocket" that was created on the '29 McOscillator on the post-peak backside rally (late Sept'29) just before the crash in '29.<<<
The summation at that point was at roughly +400, on the way down.
That is more or less the air pocket, the fact that it was a + reading, or at least in the zero range, as in '87.
In September '98 we were at -1500, and on the way up (presumably), from the record oversold at -3562 .
>>> Notice that the Oscillator (not the summation) actually exceeded the highs made at the peak of the market climb in early Sept., '29.<<<
That is true, but just that one fact alone, in a short term oscillator
that is subject to fluctuations, I don't think is that meaningful, unless
you can find other examples of it to examine.
Now, having said that, notice the sort of flapjack pattern in the oscillator after the '29 crash, on the first rally in November, at an
extreme positive reading for then, +70, +40, +90.
Compare that to September '98 - +166, +93, +230 with a similar flapjack pattern. It could indicate the end of trouble?
>>>I believe you were correct about the need to see a much more negative Summation Ratio before the bottom is in. What are your updated thoughts on that subject?<<<
At the time I thought so too. If it were going to do it, it should have done it on this last "test" down. It didn't, and now we may actually have a positive divergence. I'll analyze that some more later in the week.
I think that as crashes go, they get done in a two month period of time. You get a market high, a sense of impending trouble drives
down prices, specialists engineer a rally to set themselves short,
and then down you go. Security holders are trapped.
Since they don't generally give free lunches on Wall Street, it seems to me that if that's what we were in for, we would have already done it.
I've got an open mind here, but I am definitely leaning far away from
crash. Could be more decline of the normal variety, but the further
we go the more I think that at best it will be another retest, if that.
The weekly ratio summation is in the zone where 4 year bear/correction cycle bottoms have occurred. That zone has held
these cyclical corrections since 1982, I think. If it were to break that zone, then I would have to acknowledge that the market is in for a much more serious bear market than we have experienced since then. But if it starts turning up, then it is time to go with the presumption that the next bull cycle is at hand. Unless that summation starts breaking down again as it is heading up.
Vitas |
